Is the investment risk concerned with the range of possible outcomes from aninvestment?

Q: What is investment timing option?

A: Option with reference to investment or project refers a significant option that can affect the…

Q: Explain several ways of defining the concept of rate of return on investment?

A: Return on investment is the tool that can be used to measure the performance of the companies.  The…

Q: What does a failed net-investment test indicate?

A: Answer: Net investment test: The company will not overdraw at any stage on its return, and is thus…

Q: How do an investment's required rate of return vary with perceived risk? Explain with an example?

A: Required rate of return refers to the rate which the investors expects from their investments. This…

Q: What is the significance of the Value at Risk (VaR) method?

A: The question is based on the concept of Value at Risk (VaR). VaR is a statistical measure of risk in…

Q: Explain the difference between risk and uncertainty in the context of investment appraisal, and…

A: Investment means engaging your funds to generate income for the future. Return from the investment…

Q: Why is it necessary to determine how long you can expect to reap benefit from the investment?

A: Individuals as well as firms often make investment and specify the time limit for which this…

Q: What is an investment center manager's advise if the firm intends to adopt the return on investment…

A: This question explains about an investment center manager's advise if the firm intends to adopt the…

Q: Discuss the difficulties in using Net Present Value [NPV] as an investment appraisal method.

A: The net present value method is used by the company for the evaluation of the profitability of…

Q: What is investment decision making process ? And example

A: An investment decision refers to how a company's finances are to be invested in various assets in…

Q: why is a need for investor to evaluate the investment ?

A: All investments will have a certain percentage of risk. To control the future risks in the…

Q: What is reinvestment rate risk?

A: The reinvestment rate risk is the potential decline in the interest income that tends to be a result…

Q: Who is responsible for the financial evaluation of investment proposals?

A: The question is based on the concept of responsibility for the financial evaluation of investment…

Q: What are investment returns?

A: Investment returns are a performance measure used to evaluate a speculation’s adequacy or to think…

Q: Which is risk in the context of financial decision making and performance? Does performance…

A: Risk in the perspective of financial decision making and performance differs as the company faces…

Q: Define the term Trade-Off between Risk and Reward?

A: Risk-Reward trade off refers to an investment principle which indicates higher the risk, higher is…

Q: Does the IRR measure ignore the scale of investment?

A: The internal rate of return (IRR) is a capital budgeting metric used to gauge the benefit of…

Q: What is risk, and how does it affect decisions about investment?

A: Risk and return are related to each other while making investment.

Q: Discuss how the Accounting Rate of Return as an investment appraisal method is better than the Net…

A: Accounting ROR or ARR and Net Present Value(NPV) are tools that are used to make selection among…

Q: Define reinvestment rate risk

A: Reinvestment means investing without withdrawing the benefits (or) interest from the fund so that it…

Q: What is the potentially acceptable investment alternative?

A: An alternative investment is a financial asset that doesn't can be categorized as one of the…

Q: Discuss the pros and cons of the accounting rate of return as an investment criterion.

A: Definition: Average rate of return method: The average rate of return is the amount of income that…

Q: What kind of investment is considered to be risk-free?

A: A risk-free investment is an investment that has a minimum or no fluctuation from the expected…

Q: Illustrate the method of investment risk: Investment?

A: Following are the methods of investment risk: Investment: Standard deviation: Standard deviation…

Q: why is a risk analysis important to the capital investment decision making process?

A: Risk is the uncertainty or possibility of loss due to the decision in investment process. Of all the…

Q: In order to determine whether an investment is visible, what factors should be considered?

A: For the evaluation of a task, no fixed steps that have to be taken. Numerous things should be…

Q: Which approach to investment analysis is "best" in terms of accounting for both the timing and…

A: Capital budgeting is a tool or technique that helps to analyze the profitability of the project.…

Q: What is the relationship of risk to the investment?

A: There is a direct relationship between risk and return in investment decision making. It means…

Q: which investment is preferable?

A: The present value is the present worth of the amount that will be paid or received at present.

Q: Can we consider Project Risk by Discount Rate?

A: The discount rate is an interest rate that is used in computing the present value of the future cash…

Q: What is risk? Why must risk as well as return be considered by the financial manager who is…

A: Risk is associated with every business it is one of the important functions of the management to…

Q: What is investment strategy?

A: Investment strategies are generally used by the investors in order to protect themselves from any…

Q: Explain the difference between financial risk andbusiness risk.

A: Risk is referred as the chance of loss. An activity which leads to loss is termed as risk. The risk…

Q: discuss the importance of considering risk when analyzing investments?

A: Risk refers to the probability of uncertainties about future .Risk may also be termed as volatility…

Q: When comparing the performance of two investment alternatives, which characteristics of investments…

A: For comparison any investment alternative main thing required for Cashflow and certainty of cash and…

Q: Describe some of the investment strategies?

A: Investors always select investment strategies according to their suitability. Investors have…

Q: What are the main constraints or obstacles to implementing the investment management concept?

A: Investment management refers to the management of assets of an individual by the firm. It will…

Q: What is the relationship between risk and return?

A: Risk return relationship: The association among risk and return is recognized as the risk-return…

Q: HOW TO KNOW THE RATIO OFCAPITAL INVESTMENT?

A: Ratio of capital investment is the ratio of net operating profit to total capital investment.

Q: What does “investment risk” mean?

A: Risk is referred as uncertainty or loss. Financial risk is referred as the variability of actual…

Q: How can we Consider Project Risk by Discount Rate?

A: In corporate finance, a discount rate is the rate of return used to discount future cash flows back…

Q: Technically, the required return of an investment can be determined by determining the investments…

A: The required return on an investment is the return that is expected and assumed by an investor to be…